Washington, DC–The U.S. Department of Transportation (DOT) today launched a rulemaking to protect passengers stranded by airlines canceling or significantly changing their flights. The Advance Notice of Proposed Rulemaking (ANPRM) seeks public comment on requiring airlines to pay passengers cash compensation, rebook them for free on the next available flight, and cover meals, overnight lodging, and related transportation expenses when a disruption is airline-caused, such as a mechanical issue or an IT airline system breakdown.
“Americans know the importance of a robust airline industry, which is why this country—and U.S. taxpayers — kept U.S. airlines afloat when the COVID pandemic threatened their very existence,” said U.S. Transportation Secretary Pete Buttigieg. “Now that we are on the other side of the pandemic and air travel is breaking records, we must continue to advance passenger protections. This action we’re announcing is another step forward into a better era for commercial air travel—where the flying public is better protected and passengers aren’t expected to bear the cost of disruptions caused by airlines.”
Cancellations and lengthy flight delays can pose significant hardship, stress, and financial cost to travelers. The Government Accountability Office (GAO) found that flight cancellations from July 2021 through April 2022 potentially affected over 15 million passengers and flight delays potentially affected over 116 million passengers. According to data from U.S. airlines submitted to DOT, in both 2022 and 2023, over 60% of three-hour or longer domestic flight delays were airline-caused.
Canada, Brazil, the European Union, the United Kingdom, and other countries have adopted consumer protections that compensate passengers and provide services when an airline causes a significant delay. One study found that the European Union’s compensation and service requirements reduced the likelihood and duration of flight delays.
U.S. airlines received $54 billion in taxpayer bailouts during the COVID-19 pandemic, helping the industry recover and enjoy record travel demand. While no U.S. airline provides cash compensation to passengers for airline-caused disruptions, following DOT actions, several airlines must provide at least $50 in credits or vouchers. Thanks to DOT pressure on airlines, the ten largest U.S. airlines have committed to rebook stranded passengers at no additional cost and cover meals during an airline-caused disruption, and nine have committed to providing lodging and related transportation expenses. However, airlines can change course on their customer service commitments at their discretion, and it is often up to the airlines to determine when they are responsible for a flight delay or cancellation.
Passengers currently face many challenges in holding airlines to their promises because there is no legal obligation for airlines to notify passengers when they are entitled to services promised in the customer service plan, and their policies are generally vague on the details of delivery. Passengers must also typically request these services at the airport in person, and frontline staff may not know if a flight disruption is airline-caused or may not have enough vouchers to provide upfront services to everyone. Airlines generally do not clearly disclose when, what, and how much they will reimburse passengers who pay out of pocket.
The Department’s rulemaking is aimed at addressing these gaps by establishing baseline standards on what airlines are obligated to deliver to stranded passengers during disruptions. The Department is considering the following requirements for airlines when there is a cancellation or lengthy delay due, in whole or in part, to any circumstance within the control of the airline:
- Pay at least $200 in cash compensation: DOT is considering requiring airlines to automatically pay cash compensation to passengers whose trip disruption is caused by an airline. DOT is considering a tiered approach where compensation could range from $200-$300 for domestic delays of at least three hours but less than six, $375-$525 for delays of at least six hours but less than nine, and $750-$775 for delays of nine hours or more. DOT is also considering whether small airlines should pay less than large airlines and whether or not compensation should be required when a passenger is notified a week or two in advance of the cancellation or significant delay.
- Rebook at no additional cost on the next available flight: The Department is considering requiring airlines to offer free rebooking when the passenger’s flight is cancelled, their departure is delayed three hours or more domestically or six hours or more internationally, or if a delay results in a missed connection. DOT is considering requiring rebooking on the next available flight operated by the airline or its branded codeshare partners, and if flights on those airlines are not available within 24 hours, then any carrier that the airline has a commercial agreement to transport the airline’s passengers.
- Cover meals, overnight lodging, and related transportation expenses: DOT is considering requiring airlines to provide meals, overnight lodging, and transportation to and from lodging for stranded passengers and establishing standards regarding what must be covered as part of each service, including how often it must be provided during lengthy disruptions. DOT is considering requiring airlines to automatically pay a minimum reimbursement for each service an affected passenger is entitled to receive when airlines do not provide these services upfront, and passengers do not submit receipts for costs up to a maximum reimbursement threshold per service.
The rulemaking also solicits comment on when to consider a cancellation or delay within an airline’s control; whether airlines should provide free rebooking and certain services, like meals, during significant delays or cancellations regardless of cause, like during extreme weather events; how to incentivize large airlines to provide rebooking reciprocity to small airlines or disincentivize large airline practices that prevent rebooking reciprocity; what notifications should be required to ensure that passengers receive the correct information from the airline in a timely manner; and what customer service standards might be necessary to minimize wait times for passengers affected by a cancellation or delay.
